Super HD, 3D content only available to subs whose ISPs play nicely with Netflix.

Netflix recently said it will offer what it calls Super HD and 3D content—but only to customers whose Internet service providers agree to use Netflix's "Open Connect" content delivery network.

Cablevision, Virgin Media, British Telecom, Google Fiber, and others are on board. Time Warner is apparently negotiating with Netflix to connect to the private network, but it complains that its customers should get access to the crisper content without having to be a part of Netflix's CDN. “While they call it ‘Open Connect,’ Netflix is actually closing off access to some of its content while seeking unprecedented preferential treatment from ISPs,” Time Warner Cable said in a statement to Multichannel News. "We believe it is wrong for Netflix to withhold any content formats from our subscribers and the subscribers of many other ISPs. Time Warner Cable’s network is more than capable of delivering this content to Netflix subscribers today.”

Super HD is 1080p, but higher quality than Netflix's regular 1080p content. It requires 5Mbps download speeds at minimum and 7Mbps to get the best available quality. Netflix isn't charging ISPs to be part of its private network, but the ISPs do have to meet a list of requirements. For example, the ISP must connect to the same peering locations as used by the Netflix network and establish connections of at least 10Gbps. By requiring the use of its own network, Multichannel News notes that "Netflix saves money on third-party CDN transit fees by connecting directly with ISPs."

Netflix customers on ISP networks that aren't part of Open Connect will see the message "Your Internet provider is not configured for Super HD yet" at Netflix's Super HD page. "Please contact your Internet Provider to request that they join the Netflix Open Connect Network so you can get Super HD."

Netflix responded to Time Warner's accusation, telling Multichannel News that "Open Connect provides Netflix data at no cost to the location the ISP desires and doesn't seek preferential treatment. We hope Time Warner [Cable] will join the many major ISPs around the world who are participating in Open Connect to reduce costs, minimize congestion and improve data delivery to enhance the consumer experience."

At least one advocacy group agrees with Time Warner's position. The Competitive Enterprise Institute's Communications Liberty and Innovation Project—which typically opposes network neutrality requirements—accused Netflix of trying to "coerce ISPs into paying for a free Internet fast lane for Netflix content."

"With its 'Open Connect' model, Netflix is withholding content from the customers of ISPs that decline to accede to its demands," the group said. "Though the details of its demands are unknown, it appears Netflix is requiring that ISPs 'peer' with them or pay for the installation of Netflix equipment inside their networks as well as the ongoing costs of operating that equipment."

156 Reader Comments

If Netflix doesn't want to pay for the bandwidth required to open this up to everyone, and only sends the extra data to ISPs that directly peer with them, I don't see an issue. This has nothing to do with network neutrality. Netflix isn't an ISP. I'm greatly amused that an ISP would scream about network neutrality though. It sort of shows that they're willing to claim anything when it suits them.

Here's what this is about...if Netflix can place a CDN inside the ISP's network, then it bypasses data caps. This was Comcast's argument for their system, so Netflix is playing by their game. TWC wants to keep data caps as a penalty for Netflix users to keep them from cutting the cable TV cord.

This is about the cash cow that is data usage caps and TWC is scared of losing customers over this.

I'm a huge Netflix fan. They're doing everything they can to push the envelope, innovate, and re-invent distribution and consumption of video entertainment... so basically everything the public is clamoring for. And yet, when they do a small change to their fee structure everyone goes apeshit, abandons ship and goes back to the de-facto Cable cartels. If you want to see change in an industry you need to support those who are actually changing it and not just yammer on tech sites about how pissed off you are that you have to pay cable company X hundres of dollars a month for shows you don't watch.

They want to charge Netflix for data Netflix delivers to TWC customers. That's not the way the internet works, but previously it has just been a "we're all friends here" kind of thing. This kind of deal is looking to lock the ISPs into behaving properly since they can't be trusted to do the right thing on their own.

Here's what this is about...if Netflix can place a CDN inside the ISP's network, then it bypasses data caps. This was Comcast's argument for their system, so Netflix is playing by their game. TWC wants to keep data caps as a penalty for Netflix users to keep them from cutting the cable TV cord.

This is about the cash cow that is data usage caps and TWC is scared of losing customers over this.

Ah, THAT'S their malfunction!

TWC can DIAF. Worst ISP I ever had the displeasure of using. Hell, they factored into my moving decisions they were that bad.

If Netflix doesn't want to pay for the bandwidth required to open this up to everyone, and only sends the extra data to ISPs that directly peer with them, I don't see an issue. This has nothing to do with network neutrality. Netflix isn't an ISP. I'm greatly amused that an ISP would scream about network neutrality though. It sort of shows that they're willing to claim anything when it suits them.

Netflix along with comcast, level 3, and akami all had a lot of peering disputes 2 years ago (the outcomes of which I don't believe are public?). I'm willing to be that it played a part in that decision. =/

While maybe not the friendliest thing to do, I agree it is within Netflix's rights. Providing increased quality streams costs them a lot more money to pay for that bandwidth. With a peering agreement, burden is shared. Besides who said Netflix MUST provide SuperHD streams to everyone at their own expense? If the ISP doesn't want it, they don't have to take it.

If Netflix doesn't want to pay for the bandwidth required to open this up to everyone, and only sends the extra data to ISPs that directly peer with them, I don't see an issue. This has nothing to do with network neutrality. Netflix isn't an ISP. I'm greatly amused that an ISP would scream about network neutrality though. It sort of shows that they're willing to claim anything when it suits them.

This is what I came to say. They want to provide higher quality video to customers without charging everyone more. Not only will peering with ISPs directly reduce bandwidth costs, it will increase performance since there will be a direct link between your ISP and a Netflix CDN.

Complaining about this is like complaining that cell phone companies shouldn't be allowed to offer free in-network calls. It's giving preferential treatment!

If you can control the network end to end (Netflix-->Your ISP--->You) prices go down and quality goes up. I see this as a win for everyone.

I've seen the Netflix CDN for SE Michigan which is pretty cool. It's in a Level3 facility in Southfield where our ISP also happens to peer through. We can get SuperHD and we just have a mid size regional carrier (USSignal)

Great, another "We didn't think of Netflix first and they beat us to the punch" ISP tax.

Cable companies/ISPs need to just man up and accept that Netflix has a better business model. Accept, emulate, and innovate. Do not Obstruct or Usurp (AEI not OU, see what I did there? har har har) Trying to defeat Netflix and promote the antiquated video content delivery business models is a losing strategy. Either work with Netflix or build your own Netflix-type service.

Who is the "Competitive Enterprise Institute" exactly? These advocacy groups like to pretend they are spontaneous groups of concerned citizens, but rarely are.

Libertarian Think Tank, like other so called think tanks their job is to bend any story to fit their worldview and to espouse said worldview on any public venue that will allow them to talk.

It's like inviting the Cato Institute over for talks about regulating businesses. No matter how sensible the regulation or how much public good it might do, they will always and forever be against it because that's their position on regulation.

Conflict of interest between the ISP arm and the pay-TV arm, probably. Time Warner Cable makes a lot of money selling movies through their own channels and pay-per-view.

TWC is no longer owned by Time Warner and hasn't been since 2009, though they still have some operating agreements with their former parent company and they own no channels themselves. That being said, for all other reasons mentioned above by so many people TWC is clearly in the wrong here.

And yet, when they do a small change to their fee structure everyone goes apeshit, abandons ship and goes back to the de-facto Cable cartels.

Netflix had a good idea with DVD rentals by mail, and their streaming service has broad appeal. However, you cannot accurately describe their decision to divide the company, changes names, and essentially raise rates almost 60% for customers that wanted to keep DVD and streaming service as a "good move" by Netflix. It was a terrible move. 60% increase is a dramatic increase that would anger anyone -- and it did.

The Netflix leadership that approved the above moves is inept and ignorant of basic strategy for raising prices on a product or service. You raise rates in small increments on an annual or semi-annual basis. 5% here, 9% there, maybe even a double digit 14% increase if needed. You don't plop a 60% increase down unless you are forced to at gunpoint.

I like Netflix. I've been a customer for many years. Their leadership is terrible.

Who is the "Competitive Enterprise Institute" exactly? These advocacy groups like to pretend they are spontaneous groups of concerned citizens, but rarely are.

Libertarian Think Tank, like other so called think tanks their job is to bend any story to fit their worldview and to espouse said worldview on any public venue that will allow them to talk.

It's like inviting the Cato Institute over for talks about regulating businesses. No matter how sensible the regulation or how much public good it might do, they will always and forever be against it because that's their position on regulation.

Per wikipedia:

Quote:

According to page nine of a report from the CEI contained on the University of California, San Francisco's Legacy Tobacco Documents Library (LTDL), the following companies and foundations were among those listed as supporting CEI's work with annual contributions of at least $10,000, currently the CEI's "Entrepreneurs" level:

Here's what this is about...if Netflix can place a CDN inside the ISP's network, then it bypasses data caps. This was Comcast's argument for their system, so Netflix is playing by their game. TWC wants to keep data caps as a penalty for Netflix users to keep them from cutting the cable TV cord.

This is about the cash cow that is data usage caps and TWC is scared of losing customers over this.

I hated TWC when I had them as an ISP, but they do not have data caps. Not on any of the plans that I looked at. If they do have Data caps at all, it must be a regional testing thing.

Given how much rent seeking these companies collectively do, I hardly see them as a group of libertarians.

You've confused the dictionary definition of Libertarians with real life Libertarians. Don't worry, it happens to a lot of people, especially college students who buy into the Libertarian party platform not realizing that it's mostly smoke. These guys are very much in the "Make sure huge corporate interests and billionaires get whatever they want and aren't bothered by government or the people" Libertarians.

If Netflix doesn't want to pay for the bandwidth required to open this up to everyone, and only sends the extra data to ISPs that directly peer with them, I don't see an issue. This has nothing to do with network neutrality. Netflix isn't an ISP. I'm greatly amused that an ISP would scream about network neutrality though. It sort of shows that they're willing to claim anything when it suits them.

Exactly and a Big Fuck You to Slime Warner !!!Slime Bags who are taking part in the Six Strikes BS and also have a stake in Video and Film.

I am kind of surprised by the response on this. Maybe I am missunderstanding, but as I see the issue, Netflix is saying to its users that they can't get access to the best quality content unless they are using a preffered ISP.

My expectation of my Netflix account is that I always get the best quality picture available based on the bandwidth/quality of my connection regardless of if I am on my home ISP or cellular or some random wifi.

In my mind this is a big violation of the idea of net neutrality since you get preferential treatment from Netflix based on what ISP you use.

It is similar to the idea of restricting content based on geographical location, which I also don't agree with even though it is standard practice.

There are actually technical reasons behind it as well -- bigger files take more bandwidth, and the bandwidth may not be available in to your ISP. But if you're streaming from a CDN located within your ISPs network, there's less chance for a bottleneck or congestion, so they can guarantee a consistently higher quality picture.

Contrary to what many people believe, the Internet is not a magical data pipe that has no limits. There are limits, and Netflix is particularly bound for them seeing as they account for a significant percentage of all traffic on the Internet. Getting around the bottlenecks and limitations is a technical problem, and technical problems between two organizations require business solutions.

Here's what this is about...if Netflix can place a CDN inside the ISP's network, then it bypasses data caps. This was Comcast's argument for their system, so Netflix is playing by their game. TWC wants to keep data caps as a penalty for Netflix users to keep them from cutting the cable TV cord.

This is about the cash cow that is data usage caps and TWC is scared of losing customers over this.

I don't think TWC has data caps, certainly not in my metro market. They are not Comcast.

TWC is not scared of losing customers over this. In fact, their ads push themselves as having the best data pipes for your online entertainment. And, why not? Internet service is the real cash cow, not cable TV. It is to their advantage to have more people buying Internet service rather than TV packages. The only disadvantage to them is subscriber count leverage when dealing with Hollywood.

Internet service is the real cash cow because TWC and others charge the same amount for Internet service as many TV packages. I pay $60/month for 30Mbps service. That price is at least a 120 channel TV package, which contains channels which have to be negotiated with media providers. And, they all want a share of the $60 collected on the TV package. The cost to deliver $60 Internet service is much lower due less negotiation requirements, less lawyers, less everything. Internet service, in the end, provides more gravy for TWC and others.

"Please contact your Internet Provider to request that they join the Netflix Open Connect Network so you can get Super HD."

Seems like a reasonable way to get their customers to bug any ISP not playing ball. Cable channels have been doing this for years - how many people really wanted the "O" network? Sure, if it is included, we'll watch. Netflix already has customers with a financial interest in whether these connections are made. That is a greater incentive than the "sure, add it provided my costs do not increase" crowd.

I've worked for a very large network provider. You really do not want 100% net neutrality. You want those packets prioritized, seriously. I'm not suggesting that any blocks happen, but I am suggesting that protocols that demand real-time communications like voip and video be prioritized over FTP, usenet and bit-torrent traffic. Setting up direct connections between ISPs and Netflix should save both money and it should reduce latency and improve the end-user experience. These peered network connections are not always cheap, but they can be. Without knowing the technical details for how the connections are made and who pays for equipment and the wires/fibre, there is no way to know which side has the upper hand. Inside the same metro area, a few metro ethernet lines can make a HUGE difference and be relatively cheap. If metro ethernet isn't available, then the costs can become very large for similar bandwidth. Location matters.

I'm happy that Netflix is trying to enable better quality for their paying customers. They need to compete with Vudu which does have higher quality video.

My complaint with all these media companies is that they don't support my media center of choice - XMBC/Linux when it is clearly NOT a technical issue. I'm withholding a subscription until that support becomes available. I'm stubborn/stupid that way.

But if netflix is doing this because it is cheaper than running the same data over its existing CDN partnerships... Why is it charging more for the customers who want it? Charging more for increased costs on their end makes sense to me.. but charging more for decreased costs? That sounds like gouging their loyal customers.

I love how they bring up net neutrality arguments, when one of the arguments AGAINST net neutrality is that it would hinder "innovation", as prioritized bandwidth is somehow required to innovate for the future. And yet here they are crying out against Netflix rolling out a new future that it wants to be able to deliver seamlessly. They even say

Quote:

... join the many major ISPs around the world who are participating in Open Connect to reduce costs, minimize congestion and improve data delivery to enhance the consumer experience.

I think this is one of the better ways that ISPs have been shown to be flat-out against the consumer, pretty much unarguably. We can say it as much as we want, but to have someone as big as Netflix come and call the dissenters out like that is great.

Netflix had a good idea with DVD rentals by mail, and their streaming service has broad appeal. However, you cannot accurately describe their decision to divide the company, changes names, and essentially raise rates almost 60% for customers that wanted to keep DVD and streaming service as a "good move" by Netflix. It was a terrible move. 60% increase is a dramatic increase that would anger anyone -- and it did.